Aberdeen and Schroders fall as FTSE drops 2.12%


Asset management houses were among the biggest fallers of today’s session after the FTSE 100 shed almost 140 points to end below 6,500.

Wednesday came to a close with the index down 139.27 points, or 2.12 per cent, to hit 6,419.31 as investors ignored positive economic news and focused on speculation that US Federal Reserve could start to slow its $85bn-a-month bond-buying programme.

Aberdeen Asset Management lost 5.69 per cent to end the day at 437.5p while Schroders dropped 4.27 per cent to 2,263p.

National Grid, Tesco and Anglo American also posted some of the largest falls of the session.

The FTSE 100 dropped immediately after opening as investors were spooked by comments from Federal Reserve Bank of Dallas president Richard Fisher and Kansas City Fed president Esther George suggesting the central bank slows its quantitative easing programme.

News that the UK’s dominant service sector picked up some momentum in May strengthened hope that the country could be on track to achieve positive economic growth during 2013 but failed to halt the slide seen in the blue-chip index. Sage, Wolseley and William Hill were the only stocks seeing gains today.

Signia Wealth chief investment officer Gautam Batra remains bullish on the investment case for equities despite the recent setbacks to the market’s rally.

“Equities, in general, will continue to make progress due to better growth fundamentals and central bank support, and relatively inexpensive valuations,” Batra says.

“Fixed income investments, in the meantime, face headwinds of expensive valuations and rising inflation expectations. Rotation out of fixed income assets into equities will continue, helped along by talk of tapering of purchases by the Fed.”